IRS apologizes for targeting conservative groups

IRS agents in Cincinnati inappropriately singled out groups like the Tea Party or Patriot party while reviewing their nonprofit qualifications. The IRS insisted they had done so to make for easier processing and not because of any political bias, but the White House said there's no question the behavior was inappropriate. NBC's Tom Costello reports.

By Mark Murray, Senior Political Editor, NBC News

The Associated Press reports that the Internal Revenue Service says it gave extra scrutiny to organizations with the names "Tea Party" or "Patriot" seeking tax-exempt status.

WASHINGTON (AP) -- The Internal Revenue Service is apologizing for inappropriately flagging conservative political groups for additional reviews during the 2012 election to see if they were violating their tax-exempt status.

Lois Lerner, who heads the IRS unit that oversees tax-exempt groups, said organizations that included the words "tea party" or "patriot" in their applications for tax-exempt status were singled out for additional reviews.

Lerner said the practice, initiated by low-level workers in Cincinnati, was wrong and she apologized while speaking at a conference in Washington.

Many conservative groups complained during the election that they were being harassed by the IRS. They said the agency asked them an inordinate number of questions to justify their tax-exempt status.

Certain tax-exempt charitable groups can conduct political activities but it cannot be their primary activity.

UPDATE: Senate Minority Leader Mitch McConnell released a statement calling for the Obama administration to conduct a review of "these thuggish practices":

“Today’s acknowledgement by the Obama administration that the IRS did in fact target conservative groups in the heat of last year’s national election is not enough. Today, I call on the White House to conduct a transparent, government-wide review aimed at assuring the American people that these thuggish practices are not underway at the IRS or elsewhere in the administration against anyone, regardless of their political views.

Last year, amid reports that the Obama administration was using the levers of executive power to harass conservative political groups in Kentucky and elsewhere, I issued a very public warning to the administration that the targeting of private citizens on the basis of their political views would not be tolerated. Today’s apology by the IRS is proof that those concerns were well founded. But make no mistake, an apology won’t put this issue to rest. Now more than ever we need to send a clear message to the Obama Administration that the First Amendment is non-negotiable, and that apologies after an election year are not an sufficient response to what we now know took place at the IRS. This kind of political thuggery has absolutely no place in our politics.”